Reviewing Synaptics (NASDAQ:SYNA) & NVE (NASDAQ:NVEC)

Synaptics (NASDAQ:SYNA) and NVE (NASDAQ:NVEC) are both computer and technology companies, but which is the superior investment? We will compare the two businesses based on the strength of their risk, earnings, profitability, dividends, analyst recommendations, valuation and institutional ownership.

Institutional & Insider Ownership

99.4% of Synaptics shares are owned by institutional investors. Comparatively, 66.0% of NVE shares are owned by institutional investors. 0.5% of Synaptics shares are owned by insiders. Comparatively, 1.9% of NVE shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Synaptics and NVE”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Synaptics	$1.07 billion	2.77	-$47.80 million	($1.59)	-48.28
NVE	$25.88 million	14.33	$15.06 million	$2.92	26.25

NVE has lower revenue, but higher earnings than Synaptics. Synaptics is trading at a lower price-to-earnings ratio than NVE, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and price targets for Synaptics and NVE, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Synaptics	2	2	10	0	2.57
NVE	0	1	0	0	2.00

Synaptics presently has a consensus price target of $99.91, indicating a potential upside of 30.16%. Given Synaptics’ stronger consensus rating and higher possible upside, research analysts clearly believe Synaptics is more favorable than NVE.

Volatility and Risk

Synaptics has a beta of 1.71, indicating that its stock price is 71% more volatile than the S&P 500. Comparatively, NVE has a beta of 1.26, indicating that its stock price is 26% more volatile than the S&P 500.

Profitability

This table compares Synaptics and NVE’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Synaptics	-5.41%	4.77%	2.58%
NVE	54.59%	23.47%	22.73%

Summary

NVE beats Synaptics on 8 of the 14 factors compared between the two stocks.

About Synaptics

Synaptics Incorporated develops, markets, and sells semiconductor products worldwide. The company offers AudioSmart for voice and audio processing; ConnectSmart for high-speed video/audio/data connectivity; DisplayLink for transmitting compressed video frames across low bandwidth connections; VideoSmart that enables set-top boxes, over-the-top, streaming devices, soundbars, surveillance cameras, and smart displays; and ImagingSmart solutions. It also provides Natural ID, a fingerprint ID product that is used in notebook personal computers (PCs), PC peripherals, automobiles, and other applications; TouchPad, a touch-sensitive pad that senses the position and movement of one or more fingers on its surface; SecurePad that integrates fingerprint sensor directly into the TouchPad area; ClickPad that offers a clickable mechanical design; and ForcePad. In addition, the company offers ClearPad, which enables users to interact directly with the display on mobile smartphones, tablets, and automobiles; ClearView products that provide advanced image processing and low power technology for displays on smartphones and tablets; and TouchView products, a touch controller and display driver integration product. Further, it provides TouchPad with a pointing stick in a single notebook computer enabling users to select their interface of choice; TouchStyk, a self-contained pointing stick module; ultra-low power edge artificial intelligence platform for battery powered wireless devices; wireless connectivity solutions comprising Wi-Fi, Bluetooth, global positioning system, global navigation satellite system, and ULE; and voice over IP and digital enhanced cordless telecommunications solutions. The company sells its products through direct sales, outside sales representatives, distributors, and resellers to mobile and PC OEMs; IoT OEMs; and automotive and consumer electronics manufacturers. The company was incorporated in 1986 and is headquartered in San Jose, California.

About NVE

NVE Corporation develops and sells devices that use spintronics, a nanotechnology that relies on electron spin to acquire, store, and transmit information in the United States and internationally. The company manufactures spintronic products, including sensors and couplers for use in acquiring and transmitting data. Its products comprise standard sensors to detect the presence of a magnetic or metallic material to determine position, rotation, or speed for the factory automation market; and custom and medical sensors for medical devices to replace electromechanical magnetic switches. The company also offers spintronic couplers for power conversion and industrial Internet of Things (IIoT) market; and DC-to-DC convertors for use in power conversion systems and industrial networks for the IIoT. In addition, it undertakes contracts for research and development, and licensing of spintronic magnetoresistive random access memory technology. NVE Corporation was founded in 1989 and is headquartered in Eden Prairie, Minnesota.